BlackRock, the world’s largest money manager, which has been sharply critical of the initial public offering process, is to hire its own equity capital markets banker.

Sources close to BlackRock believe such an appointment would help the firm better manage dealflow from investment banks looking to place shares from initial public offerings and ease the sale of block trades to the wider market.

The move from BlackRock comes after an open letter in May from Luke Chappell and James Macpherson, senior UK executives at the asset manager, in which they demanded changes to the IPO process.
They complained that the relationship between fund managers and bankers during the IPO process was far too brief.

BlackRock did not respond to calls for comment.

Adam Gishen, a partner at Ondra Partners, the independent advisory boutique, said: “The bigger the institution, the more important it is to have one person manage the process during primary deals. If that person is high quality, knows the banks and understands the game, then it makes complete sense, and it is a powerful seat to be in. It helps on both sides, as both the investors and the banks benefit from there being one point of contact.”

Fidelity International was the first asset manager to hire an ECM banker in 2003, but few have followed suit.
Greg Bennett, head of European ECM at Fidelity International, and previously at JP Morgan Cazenove, said: “We have been doing this for a long time and it is no surprise that others are looking to recreate it.”

Bennett added: “Fidelity is a very large and complex organisation. It is good for the brokers and investment banks to have a single point of contact they can come to if they want to discuss block trades and IPOs. It makes Fidelity a much easier idea to deal with.”